New US offshore wind leases could support up to 28GW of clean energy capacity by 2022, according to a new study published by Wood Mackenzie.
The study examines the economic impact of offshore wind activities as a result of potential Bureau of Ocean Energy Management (BOEM) lease auctions in 2020, 2021 and 2022.
Based on existing activities and policy assumptions for future offshore wind development, two million acres of federal waters in the New York Bight, which includes parts of New Jersey, as well as California and the Carolinas, could be auctioned for commercial leases as early as this year as well as in 2021.
As well as supporting 28GW of offshore wind development the leases could generate $1.2bn in US Treasury revenue.
Other auctions for lease areas in the Gulf of Maine and areas in California could happen in 2022 and would generate an additional $500m US Treasury revenue, Wood Mackenzie found.
The analysis was commissioned by the American Wind Energy Association (AWEA), National Ocean Industries Association (NOIA), New York Offshore Wind Alliance (NYOWA), and the Special Initiative on Offshore Wind (SIOW) at the University of Delaware.
The study found additional lease areas are needed to meet demand, reduce energy costs, increase competition, and generate thousands of jobs and billions of dollars in investment.
The findings offer guidance to decisionmakers about new offshore wind leases, which can be a short-term solution to jump start recovery from a coronavirus pandemic-driven economic slowdown.
Total investment in the US offshore wind industry will amount to $17bn by 2025, $108bn by 2030 and $166bn by 2035.
From 2022 to 2035, capital investment of $42bn will go to turbine manufacturers and the supply chain, $107bn will go to the construction industry, and $8bn will go to the transportation industry and ports.
Annual capital investment for operations and maintenance activities will increase to $2.4bn in 2035.
In addition to delivering clean energy to millions of households, the offshore wind industry will also contribute a variety of economic benefits to the US economy, including supporting tens of thousands of jobs and billions of dollars in capital investment.
If the assumed BOEM auctions in 2021 and 2022 happen, total full-time equivalent job creation from the resulting offshore wind activities, including development, construction and operation will be approximately 80,000 jobs annually from 2025 to 2035, the study predicts.
AWEA offshore wind senior director Laura Morton said: “Policymakers at the Federal and State levels right now hold the key to unlocking the full potential of the offshore wind industry that will benefit all Americans.
“It’s time for us to unleash this abundant domestic energy source that will deliver tens of thousands of new jobs, revitalise coastal ports, and expand manufacturing opportunities, to reap major economic and environmental benefits.”
New York Offshore Wind Alliance director Joe Martens said: “The Wood Mackenzie study provides a new impetus for the designation and leasing of new wind energy areas in federal waters off the US coastline.
“This study documents the enormous near- and mid-term economic benefits that offshore wind energy can provide: more than $1 billion in revenue to the federal treasury, tens of thousands of jobs and billions in investments in ports, vessels and other infrastructure, at a time when the nation needs it the most.
“It’s time for the federal government to act with the same urgency as the states.”